Valvoline initiated with an Overweight at Stephens

Stephens initiated coverage of Valvoline with an Overweight rating and $49 price target After the sale of Global Products in March 2023, Valvoline became a pure play automotive retail services provider, the analyst tells investors in a research note. The firm says the company has continuously produced same-store sales growth in the mid-single to mid-teen percent range. It expects continued same-store sales growth to be driven by an increasing number of new stores, increased penetration of non-oil change parts and services, premiumization of oil selections, and macro tailwinds from an increasing number of vehicles on the road, miles driven and vehicle age. Valvoline’s continued growth story and growing EBITDA will drive shareholder return, contends Stephens.